Autodesk 2012 Annual Report Download - page 108

Download and view the complete annual report

Please find page 108 of the 2012 Autodesk annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 160

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160

Our effective tax rate was 22% and 32% during fiscal 2011 and 2010, respectively. Our effective tax rate decreased 10
percentage points from fiscal 2010 to fiscal 2011 primarily due to a change in expected future tax rates, the establishment of the
California valuation allowance in fiscal 2010 and a decrease in non-deductible stock-based compensation expense, offset by a
decrease in tax benefits from foreign earnings taxed at different rates in fiscal 2011 compared to fiscal 2010. During the first
quarter of fiscal 2010, the State of California enacted legislation significantly altering California tax law. As a result of the
newly enacted legislation, we expect that in fiscal years 2012 and beyond, income subject to tax in California will be less than
under prior tax law and accordingly, deferred tax assets are less likely to be realized.
Our future effective tax rate may be materially impacted by the amount of benefits and charges from tax amounts
associated with our foreign earnings that are taxed at rates different from the federal statutory rate, research credits, state
income taxes, the tax impact of stock-based compensation, accounting for uncertain tax positions, business combinations, U.S.
Manufacturer's deduction, closure of statute of limitations or settlement of tax audits, changes in valuation allowances and
changes in tax laws including possible U.S. tax law changes that, if enacted, could significantly impact how U.S. multinational
companies are taxed on foreign subsidiary earnings. A significant amount of our earnings is generated by our Europe and Asia
Pacific subsidiaries. Our future effective tax rates may be adversely affected to the extent earnings are lower than anticipated in
countries where we have lower statutory tax rates or we repatriate certain foreign earnings on which U.S. taxes have not
previously been provided.
At January 31, 2012, we had net deferred tax assets of $165.9 million. We believe that we will generate sufficient future
taxable income in appropriate tax jurisdictions to realize these assets.
For additional information regarding our income tax provision and reconciliation of our effective rate to the federal
statutory rate of 35%, see Note 4, “Income Taxes,” in the Notes to Consolidated Financial Statements.
Other Financial Information
In addition to our results determined under U.S. generally accepted accounting principles (“GAAP”) discussed above, we
believe the following non-GAAP measures are useful to investors in evaluating our operating performance. For the fiscal years
ended January 31, 2012, 2011 and 2010, our gross profit, gross margin, income from operations, operating margin, net income
and diluted earnings per share on a GAAP and non-GAAP basis were as follows (in millions except for gross margin, operating
margin and per share data):
Gross profit
Non-GAAP gross profit
Gross margin
Non-GAAP gross margin
Income from operations
Non-GAAP income from operations
Operating margin
Non-GAAP operating margin
Net income
Non-GAAP net income
Diluted earnings per share
Non-GAAP diluted earnings per share
January 31, 2012
$ 1,986.5
$ 2,028.4
90%
92%
$ 355.6
$ 533.4
16%
24%
$ 285.3
$ 405.4
$ 1.22
$ 1.74
January 31, 2011
(Unaudited)
$ 1,755.2
$ 1,790.0
90%
92%
$ 271.4
$ 418.8
14%
21%
$ 212.0
$ 310.4
$ 0.90
$ 1.32
January 31, 2010
$ 1,521.9
$ 1,557.9
89%
91%
$ 65.6
$ 286.8
4%
17%
$ 58.0
$ 229.2
$ 0.25
$ 0.99
For our internal budgeting and resource allocation process, we use non-GAAP measures to supplement our consolidated
financial statements presented on a GAAP basis. These non-GAAP measures do not include certain items that may have a
material impact upon our reported financial results. We use non-GAAP measures in making operating decisions because we
believe those measures provide meaningful supplemental information regarding our earning potential. In addition, these non-
GAAP financial measures facilitate comparisons to our and our competitors' historical results and operating guidance. We also
use these measures for purposes of determining company-wide incentive compensation.
There are limitations in using non-GAAP financial measures because non-GAAP financial measures are not prepared in
40